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From course:

Economics A Level (DONEEEEEEE)

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Question:

What are the Limitations and Difficulties of the Multiplier Effect?

Author: eric_galvao



Answer:

-The Size of such Effect depends on Leakages from the Circular Flow of Income, which is hard to Measure in Reality. -Time Lags, and often Years of Government Spending showing in the Economy in its Full -Measuring the Size of such Effect is hard as it is Changing Constantly -Governments as a result may be Unable to Control GDP very much


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